With the impending Renters’ Reform Bill set to effectively ban fixed-term tenancies, there’s likely to be a change in the way that student accommodation is let. Typically, students will sign a set-length agreement with their landlord, but these tenancies are due to be consigned to the past with the latest bill.
Opago has dug into what this could mean for student landlords, exploring flexible solutions and how the landscape could look in the short, medium, and long term.
What’s Changing?
In our recent blog, From Legislation to Innovation: Buy-to-Flex and the Renters' Reform Bill, we looked at the big changes that the bill would introduce. One of the highlights was that assured shorthold tenancies (ASTs) would be replaced by more freeform, rolling tenancies.
While these rolling, month-by-month tenancies are good news for standard renters, it’s not ideal for students. With term time lasting from September until early summer, a set tenancy generally works better for them.
Other changes include changing the rules on evictions, re-taking properties when rent isn’t paid, and a digital platform for landlords. More information on the bill and its potential ramifications can be found on our blog.
What Does It Mean?
There has already been concern around the new rules, with Timothy Douglas, head of policy and campaigns at Propertymark, saying: “The UK government must understand the ramifications that changing fixed-term tenancies to periodic will have within the student let market.
“Our member agents continue to express concerns, stating that without the seasonal predictability provided through fixed-term tenancies, the market will be unable to continue to provide a consistent supply of homes at the points of the year where it is needed most and risks reducing housing options for students.”
Set-length tenancies provide a level of certainty regarding occupancy and rental income. Without them, landlords may struggle with unpredictable turnover and vacant periods between tenancies. This could lead to financial instability, especially for those that rely on rental income to cover mortgage payments or other expenses. This also leads to difficulty planning and budgeting. If tenancies become open-ended or shorter in duration, it becomes harder to forecast income and manage expenses effectively. This lack of predictability can make it challenging to plan for repairs, maintenance, and property improvements.
Longer tenancies generally involve less administrative work, such as finding new tenants, conducting reference checks, and drafting new contracts. If set-length tenancies are banned, landlords may find themselves dealing with more frequent turnover and the associated administrative tasks. This can be time-consuming and may require additional resources or hiring external help.
Furthermore, if set-length tenancies are banned, it might attract more landlords to the student rental market due to the perceived higher turnover and potential for increased rental income. This increased competition could lead to a higher supply of rental properties, potentially impacting rental prices and occupancy rates.
What Can We Do?
Potential amendments have already been discussed by the housing minister, Michael Gove, but to guarantee a better deal for your portfolio and your guests, action is required now. At Opago, we specialise in finding flexible solutions that work for portfolio owners. Learn more about our offering and how it can combat these potential changes below.
In the UK, we provide flexible letting services for portfolio owners. Our work in the student sector helps landlords to fill voids, and we believe that this same approach can help in the face of impending changes. With our flexible agreements, student landlords can fill their properties with academics during term time and private guests during the off-season.
Secondly, all our services are backed by first-class property operations. These operations ensure that properties are managed effectively with first-class housekeeping, effective maintenance and compliance, and welcoming guest services. These regular, emergency, and ad hoc services are designed to work around landlords, so the potential chaos of no set-length tenancies will be easy to overcome.
What’s Next?
If you’re ready to bring control back into your own hands, get in touch with the Opago team today. We have operatives across London ready to take your student housing portfolio to the next level, regardless of legislation passed by the government. Our technology-backed services are designed to fulfil your needs effectively and efficiently.
Check out our savings calculator to get a rough idea, and then set up a meeting today to discuss your portfolio in greater detail.
